To revive its sagging economy, America needs a new locomotive of growth: a new job-creating engine. In the 19th century, canals and railways were the locomotives of growth. In the 20th century the locomotive was fueled by the combination of freeways and cheap oil. These locomotives were created by the private sector in partnership with government. Today's U.S. government stimulus quiver has run out of arrows: the traditional monetary and fiscal policies have run out of steam. We cannot stimulate domestic production without adding structural changes to the economy. It is like pushing on a string or trying to inflate a tire with a hole in it. Entire industries are now overseas, predominantly in Asia. Hence the persistent very high US jobless rate. There is absolutely nothing on the horizon that promises to revive the sagging American economy.
This paper proposes a new locomotive of growth in the form of an Apollo-scale health and energy initiative to be financed, almost totally, by the private sector. This initiative will lay a solid new foundation for a vibrant economy and put America back to work. It's a job-creating machine for the 21st century. The beauty of this plan is that it does not exacerbate the deficit or balloon the size of government.
Where will the money come from? Currently, we're in the middle of a huge liquidity crisis. Investors and corporations have trillions of dollars sitting on the sidelines waiting for a secure financial vehicle to invest in. We are proposing the creation of two new government-guaranteed private venture funds that will activate this dormant, parked money and use it to rebuild our economy--making energy and health twin locomotives for economic growth. This initiative will replace the overstretched consumer as an engine for economic growth.
Here's how the U.S. government, in conjunction with a consortium of "Venture Capitalists," can help jump start this new locomotive:
1) Develop two blueprints that detail the Energy and Health initiatives. The Energy Blueprint defines the architecture for a green nation-wide grid--including the details of how different sources of clean energy can participate in the grid. The Health Blueprint defines an Apollo-like medical research program to eradicate the big Medicare draining three chronic diseases in America, cancer, heart disease and diabetes, with a heavy emphasis on prevention. Technocrats can work out the details and present them as a package for political review and approval.
2) Announce the creation of two new government-supported Private Venture Funds: the U.S. Energy Fund and the U.S. Health Fund.
3) The government will insure the initial investments (i.e., the Founder Stocks) that go into the venture. In return, the government will be given a 15% ownership of the Founder Stocks. The bulk of the fund will come from a sea of money that is currently sitting on the sidelines looking for safe and profitable sources of investments. As a further incentive, the government could waive capital gains and dividend taxes on these funds.
4) The Energy and Health Funds will fund new and existing ventures to achieve--in record time--the goals set by the blueprints.
5) The government will subsidize some of the non-profitable parts of the plan (for example, some parts of the public energy grid, basic medical research). In these cases, the government will receive additional stock in return for its investments.
6) When these two initiatives are successful, the government will eventually sell its stocks to fund Medicare and Social Security. There are sixty trillion dollars in unfunded entitlements, primarily in Medicare and Social Security, which will somehow have to be financed. Increasing taxes on a job base which has shrunk due to globalism is not the answer.
This program will put America back to work in record time at minimal cost to the taxpayer. It will also revive the financial markets. America will be issuing government-guaranteed securities that are backed by real infrastructure. The program shifts the implementation of these initiatives from the public sector, transforming them into public private initiatives, resulting in enhanced creativity and job growth. Checks and balances, tough underwriting, transparency, bullet proofing from lobbyists and all those who will try to subvert the process for individual profiteering, high principles, and extensive due diligence are paramount to a successful program.
Implementing this plan will mobilize resources from every sector of our economy.... research and development, capital markets, domestic factory production, construction, and most importantly will harness the underutilized talents and energies of millions of American workers in all skill categories. The jobs produced must be domestic ("sticky") and not easily transferred offshore.
Structuring the energy and health initiatives as proposed, will enable them to be implemented on a much bigger and well funded scale than simply appropriating limited government funds for government administered initiatives. Just as essential, the nation will be offered a new vision to strive for, distracting its attention from the self perpetuating spiral of fear of global systemic failure we are once again in. It is a win-win proposition for putting America back to work. It's a new locomotive of growth for the 21st century. It will create millions of new American jobs without adding new taxes or expanding the deficit. Over time, the new jobs will reduce the deficit and make America the most productive country on earth.
Michael Job lives in California. He holds a BA in political science and an MBA in international finance from UCLA. He also holds a Juris Doctor in Law from Western State University. Michael has lectured in Christian apologetics and comparative religion at university campuses, business groups, and community centers in nearly thirty countries on five continents. Michael upon graduation from UCLA was employed by Credit Suisse, Los Angeles, as a loan officer, and then was active in commercial brokerage, and real estate development. Michael authored a popular apologetics website, which is translated in 12 languages, and has been a guest on radio and television shows in several countries.
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